Mangaluru: While the Rs 11,300 crore NiMo fraud has virtually shaken the banking industry, the ?Punjab National Bank it is learnt to have put the onus of these faulty transactions on one Gokulnath Shetty, the then Deputy Manager of the bank for having brazenly flouted followed the set procedures ?for issuing the letters of undertaking?. ?
Shetty, who happens to be a Mulky native had migrated to the financial capital of the nation to pursue his studies after having graduated from Vijaya College here. Having postgraduated at the reputed Sydenham College of Commerce and Economics, Shetty secured a job at the Punjab National Bank. The frauds are said to have taken place during Shetty’s stint in the forex department of the bank till his retirement.
It is alleged that Shetty had issued the LoUs, on behalf of the three firms associated with diamond merchant Nirav Modi and his family members without ensuring that the beneficiaries had been sanctioned the necessary credit limit or had deposited adequate cash with the bank as collateral. In order to avoid detection, Shetty along with few other officials purposely did not post entries of these transactions in the bank’s central database but they did pass on messages to the overseas branches of other Indian banks to honour the “fake” LoUs for settlement of import bills on the beneficiaries’ behalf.
The fraud reportedly came to light after Shetty’s retirement, when his successor declined to oblige Modi’s request. The branch records did not corroborate with the firms claims that they have been availing such facility at the bank in the past. It was then that the issue of fale LoUs came to light and an initial complaint was lodged.
The CBI has registered a case against Shetty and other officials at the bank.
